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The Basic Income ‘What’s in it for me’ Series: Employed people

By Roderick Benns

In this series, we examine the value of a basic income guarantee to various sectors of society. In today’s column, we look at three reasons why it’s a great policy idea even for people who already have jobs.

A basic income should be Canada’s next great social program. Even if you are a fully employed person, there are many reasons to support a basic income guarantee. We’ll talk about just three of them below.

But first, what is a basic income guarantee?

A basic income would ensure that no Canadian would ever drop below the poverty line. Let’s say it was set at $20,000 per year. If someone earned $15,000 in one year, then at tax time an additional $5,000 would be given to that person, spread out over 12 months using the existing income tax system. Clean and simple and minimal bureaucracy. No one is overseeing the process to determine if it is ‘deserved.’  We could scrap the entire welfare system and review other levels of bureaucracy, too.

In addition to the bureaucracy savings, Canada already spends up to $86 billion a year in combatting poverty…and yet we still have poverty. Basic income is simple in design and effective. No one gets left behind.

Now, on to those top three reasons…

Top Three Reasons for the fully employed to Speak Up for Basic Income

  1. It’s not the 1950s anymore and jobs aren’t guaranteed for life. Just because you’re working now, it might only take an economic downturn or a corporate restructuring and anyone – including you — could be out of work. If a basic income policy were in place, you would be assured of enough money to keep you above the poverty while you are searching for new opportunities. Think of basic income as a trampoline that helps you bounce into a new opportunity. With welfare, you would have to liquidate every asset you have just to qualify for money that isn’t even enough to live on.
  1. Having a basic income guarantee will actually create better jobs. This will happen because employers will have to offer fair compensation to you. If they don’t, you as an employee can refuse the work for the pay being offered because you know you won’t be in desperation mode. The basic income guarantee is your back-up. While very few people would want to live on just a basic income guarantee for long, this will help tip the scales back toward employees.
  1. Work is far more precarious today, with more people employed part-time, doing contract work, and often without benefits. Having a basic income guarantee would ensure you don’t slip into poverty while looking for new prospects.

Roderick Benns is the publisher of Leaders and Legacies. To Read The Basic Income ‘What’s in it for me’ Series: Business owners click here.

13 comments

  1. What you’re describing is not actually a basic income. A basic income is a baseline income provided to everyone regardless of whether or not they earn more than the basic income.

    If the basic income is $15,000/yr, a person earning $20,000/yr from paid employment would receive and additional $15,000/yr which then puts their total at $35,000/yr.

    Thus, those who are employed benefit as well because they still receive an additional $15,000.

  2. A true basic income is superior to what you are describing because in your scenario where only incomes below $20,000/yr are supplemented, someone already making $20,000/yr receives no extra benefit from working versus not working whereas in a real basic income scenario (with BI=$20,000/yr), someone already making $20,000/yr would get $40,000/yr.

  3. Your three reasons are still valid and applicable to a true basic income. For a true basic income, you could add a fourth reason which is that people who are employed (from any income bracket) receive additional income via a basic income

  4. Roderick Benns

    It’s still a basic income, Mark — whether universal demogrant, negative income tax, etc. It may indeed be superior but it would also be more difficult to sell, politically. It would also require a larger, more immediate outlay of money. I think it’s better to support the idea of a basic income first and foremost and then have a good debate on how to set it up.

  5. Roderick Benns

    I would say it’s the pure demogrant model.

  6. The problem with the top-up idea is why would any of us do extra work? I drive a school bus now and make about $14,000 a year. I could make another 2,000 if I drive extra lunch routes. With your scenario, I wouldn’t be interested in extra driving. Then again, why drive the bus at all? Stay home and get the full amount.

    I agree with Mark, we need to give everyone a basic amount regardless of their situation.

  7. You could also set it up in a way so that individuals making less than 250k a year would get that 15 grand off their yearly taxes.

  8. Roderick Benns

    Ronee, most people are wired to work in some form or another. In your scenario, you may indeed choose to earn that $14,000 per year and then not worry about other, formal work. However, I am willing to bet you are ‘working’ (being useful) in many other ways, to your family or to society. Caring for children, an elderly parent, helping a neighbour, volunteering, participating in civic life…there are many ways we work and it is ‘work’ that needs to be re-defined in 2016 and beyond. It is one of the great challenges to sell this social policy, no matter what method of income distribution is chosen. Our society’s Protestant work ethic, infused over decades of expectation that we labour for someone else in order to qualify as useful, is what needs to change.

    • By giving everyone a Basic Income, charities and non-profits will have a great number of people willing to help them.

      However driving a school bus is classified as on-call driving. We get paid when there’s work. So to increase our pay, we jump in to cover open routes due to bus break downs or lack of drivers. We already don’t have enough drivers for our routes now. I’m sure if we get this top-up idea, most of us won’t be answering any calls to cover bus break downs. Helping in those situations is tough because we don’t know the route plus it’s late and we want to go home etc. With my idea of universal basic income, any extra work would add to the person’s income.

      • I completely agree with you Ronee. The topping-up idea that Roderick Benns proposes only works to decrease productivity. Once productivity decreases, oppressors will then say “You see! Basic income doesn’t work!” when they didn’t even try a true basic income yet.

        Providing a flat basic income to all REGARDLESS of what one currently earns will encourage people to keep working.

        For Roderick Benns’ topping-up idea where all low incomes are topped-up to $20,000, janitors and people working at McDonald’s aren’t going to work there if they are going to make $20,000 one way or another. The only incentive for people to keep working such jobs is that they get the flat $20,000 plus whatever that particular job pays.

        The topping-up concept will completely sabotage what basic income is truly all about. A true basic income is elegant economics and is even easier to implement than the topping-up idea.

        I have no idea why this Roderick Benns is incapable of understanding that.

  9. Roderick Benns

    Mark, I’m not sure that you have absorbed what I said earlier. Allow “this Roderick Benns” to be more clear, then. I would be happy with either basic income model. I believe the negative income tax model is more politically palatable, that’s all. You shouldn’t equate my advocacy for a negative income tax with a lack of understanding on my part for your demogrant model. Proponents of basic income can talk about both models and let governments decide what they’re most comfortable implementing.

  10. I’m joining this conversation late, but would like to support Roderick’s position this way. As he says, the top-up model will be much less expensive to fund from the get-go and for that reason is way more palatable politically – hundreds of billions of dollars less expensive. Were we to choose the Universal Demogrant model, which would mean everyone would get the money and those who arecomfortably off would have it clawed or taxed back, we would have to increase tax rates, perhaps substantially, and not only on the wealthiest Canadians. At this point in our national history, after at least 30 years of anti-tax rhetoric, any program that will increase tax burdens, no matter which ones and no matter on what bases are up against major resistance right off the bat. Unfortunately, we’ve lost the sense that taxes are the way we pay collectively for things we can’t pay for alone and so tax ought not to be a ‘four letter word’! Imagine Canada with no roads, airports, schools, etc…. There are some very strong advantages to a Universal Demogrant model, but none will materialize if the program is never implemented because seen to be way too expensive! (It’s worth noting however, that most European basic income advocates are arguing for a Universal Demogrant. I don’t know why the enormous initial outlay is not seen to be the impediment there that it’s believed to be here.)

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